Mexican microfinance institution Compartamos breaks silence since IPO

Mumbai, July 7: : Breaking their silence since their April 2007 IPO, Carlos Danel and Carlos Labarthe, co-founders of Compartamos, the leading Mexican microfinance bank, publish an excerpt of their newly released “Letter to Our Peers” in the latest issue of the magazine Microfinance Insights. The authors, who have been criticized by members of the microfinance community since their IPO brought in extraordinary returns, acknowledge in the letter that social and economic goals can reinforce each other, but state that “there is no agreement on the appropriate levels of the use of profits to achieve this balance.” They explain that the Compartamos IPO, the first for a microfinance institution (MFI), has been an initiative to build the company, and has helped convince the private and the entrepreneurial class that “microfinance is worth pursuing.”

The 2007 Compartamos IPO was a symbol of the sector’s exponential growth, and since then there have been other signs of microfinance’s movement into the mainstream—a growing number of nonprofit microfinance institutions transforming into regulated entities, more mainstream media coverage, and larger investments from more mainstream investors. It is this movement that is covered in the newest issue of Microfinance Insights--Mainstreaming: Are We Ready for Takeoff?.

For this issue, Microfinance Insights has produced a timely survey on the global microfinance investment scene, gathering views from over 150 investors and MFIs around the world, covering a range of issues from investment criteria, motivation for investment, preferred sources of funding and preferred exit strategies. The results of the survey are previewed in the issue.

Other features of Vol. 7 Mainstreaming: Are We Ready for Takeoff? include:

-- An interview with Jean-Philippe de Schrevel, Founder and CEO of BlueOrchard, a leading microfinance investment manager;

-- Commentary by Anantha Nagasewaran, a MINT newspaper columnist and Director of Aavishkaar International, on the risks posed by the increased interest and flow of money into microfinance;

-- Lessons for microfinance from the subprime meltdown in the US from Microvest;

-- Global perspectives on how regulation affects transformation of NGOs to MFI banks from Syria to Kazakhstan and Ecuador to Pakistan;

-- An Albanian case study on using a foreign currency swap to hedge risks by the Dutch firm FMO;

-- Embracing commercialization from Philip Vassiliou, Director of Legatum Ventures;

-- The value of securitization for freeing up microfinance cash-flows from Grameen Capital

-- “Investing at the Edge” from Rob Katz, founder of NextBillion.net

-- And much more…

Microfinance Insights is a dynamic, fast growing magazine with over 5,000 readers around the world who praise the publication as a valuable resource and a thought leader in the microfinance sector. Shafiq Ahmed, of UK investment firm Sphere Partners says, “We see Microfinance Insights as the Economist of the microfinance sector.”

Past issues of the magazine have highlighted opinions and analyses from leading industry voices from the World Bank, the IFC, Morgan Stanley, Women’s World Banking, MIX Market, MicroCapital Monitor, the Micro Insurance Center, Sanabel, SKS and many others.

In September 2008, in response to reader and advertiser requests, Microfinance Insights will move from a quarterly publication schedule to a bi-monthly (6 times a year). The inaugural bi-monthly issue will explore ”Technology Solutions for Financial Inclusion.” Previous issues have offered analysis of urban microfinance, a look at innovations in financial services delivery, and the sector’s human resource challenges. Published in India, the magazine is international in scope, which is reflected through articles focusing on global trends and initiatives.

Subscriptions are available online:

www.microfinanceinsights.com. Advertising packages for financial institutions, MFIs, NGOs, technology firms and market facilitators are available. For subscription details, article contributions and to advertise, write to lindsay@intellecap.net or call +91-22-40359222 or send a fax to +91-22-28801572. To learn more about the magazine, visit www.microfinanceinsights.com.

About Intellecap

Intellectual Capital Advisory (Intellecap) (www.intellecap.net) is a social business advisory firm that incubates innovative businesses, enables capacity building, and facilitates investment initiatives in the development sector. Working in direct design, execution, as well as indirect strategic advisory roles, Intellecap seeks to create unique solutions that efficiently and effectively address development problems.

About Microfinance Insights

Microfinance Insights (www.microfinanceinsights.com) is an international print magazine published by Intellecap to serve the knowledge needs of the growing microfinance sector. A comprehensive and consolidated resource, the magazine publishes diverse global voices, uncovers trends, and analyzes critical issues from economic, business, and social angles. By building knowledge and bringing in new international perspectives, particularly from developing countries, the magazine has become a microfinance thought leader. It is read by over 5,000 people around the world, who attend our knowledge-building events, and participate in global responsible finance, mobile finance, and microfinance conferences.